LaneAxis Virtual Freight Management recently published a report stating that the country’s largest Carriers outsource 42% of their contracted freight to smaller Carriers. This figure was based on a detailed study of 2015 financial reports from the country’s 13 largest publicly traded Carriers. LaneAxis focused on the percentage of total revenue spent on “Purchased Transportation” – as stated in the annual reports – to reach its conclusions.

Our findings generated widespread interest and a productive debate on the issue of Carrier subcontracting, and its true prevalence in the trucking marketplace.

A representative for a large Carrier suggested the 42% figure was “grossly inaccurate” based on his definition of “purchased transportation,” which he argued includes payments to owner-operators who work under the same MC Number as their larger counterparts. He claimed this practice does not amount to outsourcing.

In a piece published Monday on “Live Trading News,” respected financial analyst Paul Ebeling delivered his opinion on the LaneAxis platform:

“This Virtual Freight Management network matters, because it allows the Shipper and Carrier to interact directly, without a middleman, allowing both the Shipper and the Carrier to ultimately eliminate a significant cost component in the freight transportation chain.”

SAN DIEGO, CA – A LaneAxis Virtual Freight Management study of the nation’s top 50 Carriers (as ranked by Transport Topics) revealed the 13 biggest public companies outsource an average of 42.29% of their freight shipments. This figure is based on the percentage of total revenue those carriers spent on “Purchased Transportation” – essentially subcontracted freight shipment services.

“Our findings are clear – many Shippers likely aren’t getting the visibility they think they are,” says Rick Burnett, LaneAxis CEO and Founder. “Large Shippers and Carriers may be able to manage their own fleets effectively, but with so much freight being outsourced to small Carriers with six trucks or less – which is 97% of the trucking industry – that’s a problem. There’s very little visibility into that network”

As a primer for some more in-depth reporting on FMCSA’s Compliance, Safety, Accountability program set to be published on CCJ later this month, here’s a look at the 10 states with the most hours-of-service violations:

All 10 states highlighted on the map above have enforcement programs that hit hours violations well above the 10 percent national average.